USD/CAD rebounds in tandem with US dollar, nears 1.2750

USD/CAD reverses a dip below 1.2700, as bulls track the DXY rebound.
Risk-off mood returns, boosts DXY, downs WTI prices.
Focus remains on covid developments and EIA crude stockpiles data.

Dhwani Mehta FXStreet

USD/CAD is holding onto the recovery gains above 1.2700 in European trading, tracking the rebound in the US dollar across the board.

The safe-haven demand for the greenback has returned amid souring risk sentiment, as persisting concerns over the Delta covid variant continue to outweigh any optimism over the US stimulus. Ongoing US-China tensions also add to the cautious market mood, collaborating with the dollar’s renewed uptick.

Meanwhile, falling WTI prices drag the resource-linked Loonie lower, supporting the bounce in the major. The US oil drops back below $67 amid a reduced appetite for risk assets and an unexpected build in the US crude supplies, as shown by the American Petroleum Institute (API) late Tuesday.

Looking ahead, the pair will remain at the mercy of the US dollar dynamics and oil-price action while the Senate Democrats' vote on the infrastructure bill will also remain in focus.

USD/CAD technical outlook

FXStreet’s Analyst, Anil Panchal, notes: “A clear break of 1.2730 will enable the USD/CAD bulls to refresh the monthly high beyond 1.2800. Alternatively, a downside break of the 21-SMA level of 1.2675 will be probed by the stated support line near 1.2655 and the early-month top surrounding 1.2590.”

USD/CAD additional levels to watch

USD/CAD

Overview
Today last price	1.2727
Today Daily Change	0.0046
Today Daily Change %	0.36
Today daily open	1.2681

Trends
Daily SMA20	1.2459
Daily SMA50	1.2267
Daily SMA100	1.2375
Daily SMA200	1.2623

Levels
Previous Daily High	1.2787
Previous Daily Low	1.2675
Previous Weekly High	1.2621
Previous Weekly Low	1.2427
Previous Monthly High	1.2487
Previous Monthly Low	1.2007
Daily Fibonacci 38.2%	1.2718
Daily Fibonacci 61.8%	1.2744
Daily Pivot Point S1	1.2642
Daily Pivot Point S2	1.2602
Daily Pivot Point S3	1.253
Daily Pivot Point R1	1.2754
Daily Pivot Point R2	1.2826
Daily Pivot Point R3	1.2866

Author

Dhwani Mehta

FXStreet

Residing in Mumbai (India), Dhwani is a Senior Analyst and Manager of the Asian session at FXStreet. She has over 10 years of experience in analyzing and covering the global financial markets, with specialization in Forex and commodities markets.

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